Monthly Archives: January 2014

OTTAWA  A long-expected stampede to the courts has begun as environmental groups and First Nations seek to block Enbridge Inc’s proposed $7.9-billion Northern Gateway megaproject.

Four similar actions filed in the Federal Court of Appeal in Vancouver on Friday ask the court to block Prime Minister Stephen Harper’s government from approving Enbridge’s application to construct a pipeline from northern Alberta to Kitimat on the B.C. coast.

One action was filed by ForestEthics Advocacy, Living Oceans Society and Raincoast Conservation Foundation, three B.C.-based groups that participated in the 18-month review by the Joint Review Panel. Similar actions were filed by the Haisla Nation, the Gitxaala Nation and by the Environmental Law Centre at the University of Victoria on behalf of B.C. Nature and Nature Canada.

The panel, representing both the National Energy Board and the Canadian Environmental Assessment Agency, concluded in its Dec. 19 report that the project is unlikely to have significant environmental effects except on certain woodland caribou and grizzly bear populations. The panel made 209 recommendations aimed at reducing the risk of environmental damage.

The federal cabinet has 180 days to consider the recommendation.

The panel process, however, has long been seen as only one component of what is expected to be a drawn-out battle over Northern Gateway.

Many critics assumed  correctly as it turned out  that the panel would come down on the side of industry.

Public protests and court actions, by both environmental groups and especially First Nations, are viewed by many as potentially more troublesome for Enbridge and the Harper government than the panel’s work.

The court action alleges that the panel based its decision on insufficient evidence and that the panel did not meet the statutory requirements of the federal review process.

“The JRP did not have enough evidence to support its conclusion that the Northern Gateway pipeline would not have significant adverse effects on certain aspects of the environment,” Ecojustice lawyer Karen Campbell said in a statement.

“The panel made its recommendation despite known gaps in the evidence, particularly missing information about the risk of geohazards along the pipeline route and what happens to diluted bitumen when it is spilled in the marine environment.”

An Enbridge spokesman said the company expected court actions, but said such efforts are “premature” until the federal government makes a decision.Northern Gateway, the limited partnership set up by Enbridge to finance the pipeline, “is confident in the integrity of the Joint Review Panel process and report,” said Ivan Giesbrecht.

“Its recommendations and conditions are based on science and the input of experts.” He added that the company doesn’t anticipate the court action will “necessarily delay” the government’s decision.

The panel had always insisted that climate change questions were outside its mandate, and, in its report, the panelists also argued there wasn’t a clear connection between Gateway and the booming oilsands.

“We did not consider that there was a sufficiently direct connection between the project and any particular existing or proposed oilsands development or other oil production activities to warrant consideration of the effects of these activities,” they wrote.

The panelists cited, as evidence to back up this assertion, that the pipeline proponent didn’t signal an intention to develop oilsands resources.They also noted that the pipeline starting point at Bruderheim, near Edmonton, “would not be located near oilsands developments and could receive oil from a variety of sources.”

Yet in the same report, panelists cited testimony from project advocates directly linking Northern Gateway to the oilsands industry in order to back up their argument that the project was in Canada’s economic self-interest.

“Those arguing in favour of the project said bitumen production was growing faster than upgrading capacity in Canada. . . . To obtain full value, they said, bitumen would need to reach complex refineries beyond those currently served in the North-Central and Gulf Coast regions of the United States. The next-nearest concentration of complex refineries is in East Asia, mainly in China.

“They said Northern Gateway would provide a relatively short and direct route to East Asia as well as access to other refining markets such as India and California.”

VANCOUVER  Diluted bitumen, the molasses-like product that would be transported by the proposed Northern Gateway pipeline, sinks in salt water when battered by waves and mixed with sediments, according to a new study by the federal government.

However, when free of sediments, the crude floats even after evaporation and exposure to light, the study determined.

The report, conducted by Environment Canada, the Department of Fisheries and Oceans and Natural Resources Canada, also said that the commercial dispersant Corexit 9500 used in cleaning up conventional spills had a limited effect on dispersing diluted bitumen.

Whether the oil sinks or floats in the event of a spill has been a source of debate, pitting environmentalists against supporters of projects such as the Northern Gateway pipeline. Part of the argument has been that if the oil sinks to the ocean floor its harder to recover.

The study examined two blends of crude, the Access Western Blend and Cold Lake Blend, which represent the highest volume of diluted bitumen, or dilbit, products transported by pipeline in Canada between 2012 and 2013.

This work demonstrates that, in waters where fine- to moderate-sized sediment is present, these oils are at risk to sink, when there is a high degree of mixing energy available, the report said.

The experiment compared the two dilbit blends to an oil used for marine ship fuel.

The oils were evaporated at what the paper said was a typical marine temperature range. They were also exposed to 120 hours of light under a UV lamp. The dilbit samples did not sink in either cases.

And when mixed in a tube with salt water, the dilbit samples remained afloat. However, when mixed with three types of sediments of various sizes, the results differed.

In general, mixtures with kaolin (a fine particulate) formed finely divided oil-sediment particles that sank in the salt water, with one exception for the highly weathered fractions for both AWB and CLB, the report said.

Mixtures with the larger particles of diatomaceous earth likewise dispersed and sank, though a portion of the oil remained unmixed and floating on the surface. Mixtures with the coarser sand, however, formed a single, continuous phase of floating oil-salt water entrained mixtures, and only a small portion sank as an oily sediment mixture.

However, the study acknowledged that the tests were conducted in a synthesized environment, and its possible that oil products could behave differently in the natural environment.

The dilbit samples were also placed in a wave tank facility in Dartmouth, N.S., to see how they would react to a chemical dispersant that has proven effective with conventional crude spills. In non-breaking waves, the oil remained on the surface.

But under breaking waves, the chemical caused only partial dispersion, the study said.

There is no record of chemical dispersant used on an actual dilbit spill, and since the composition of different dilbit varies, finding an effective dispersant may be challenging, the report concluded.

In 2010, roughly 843,000 gallons of diluted bitumen spilled from an Enbridge (TSX: ENB) pipeline into the Kalamazoo River in Michigan.

The oil was carried downstream during a flood. Even though much of it was sopped up, about 10 to 20 per cent mixed with sediment and sank to the bottom of the river, the report said.

Conducting research on how diluted bitumen would behave in a marine environment was one of the 209 conditions announced by a review panel that approved the proposed Northern Gateway pipeline in December.

The pipeline  if given final approval by the federal government  would carry diluted bitumen from Albertas oil sands to tankers on the British Columbia coast.

The National Energy Board (NEB) has informed me that on Wednesday, January 15th they will post an online application for the public to apply to participate in upcoming hearings about whether or not to approve Kinder Morgans proposal to build a new crude oil pipeline from Edmonton to Burnaby. This call for applications is happening much earlier than I expected and will close on February 12.

Applicants must demonstrate they have a direct interest in the granting or refusal of the project. Applicants must also link their interests to the twelve issues the NEB has posted on the project webpage.

I think British Columbians should decide if the proposed new Kinder Morgan Pipeline from Edmonton to Burnaby is good for our community, not big, foreign-owned energy companies or Ottawa politicians.

It is not difficult to apply and I urge everyone on the pipeline and tanker routes to apply to be an intervenor so they can have their views considered in this important decision-making process.

In order to help you, my Community Office will be running a computer lab with staff and volunteers who can assist you to apply online. The Community Office at 4658 East Hastings will be open extended hours to accommodate people in the evenings and on Saturdays. My office has many copies of the NEB`s Hearing Process Handbook and the Landowner Guide if you would like a copies.

I am also hosting a special Community Information Meeting on January 25th. You can find out more and pre-register for this meeting at LetBCDecide.ca

Thank you and if you have questions or concerns please do not hesitate to contact my office.

VANCOUVER – A task force report has been handed in to the British Columbia and Alberta governments that examines the idea of transporting oilsands’ crude via rail if proposed pipelines don’t get the green light, government documents show.

It’s an idea the environmental group ForestEthics calls “underhanded.”

It’s a “backdoor way for industry to bring tankers to the coast without the same sort of public oversight or public process that weve had around the Enbridge pipeline or would have around the Kinder Morgan pipeline, said Ben West, campaign director for ForestEthics.

A joint provincial working group was announced by premiers Christy Clark and Alison Redford in July to develop recommendations related to energy exports and the opening of new export markets for products like bitumen for the two provinces, including pipeline and rail transport.

“Rail can be considered a viable alternative to pipeline movement based on costs of transport,” the terms of reference for the group states. “If pipelines are not developed, rail will step into the void to deliver bitumen to the West Coast.”

West said the report raises safety questions, especially in light of two recent high-profile train accidents.

Oil transport by rail has become a contentious topic after a train containing crude oil derailed and exploded in Lac-Megantic, Que., in July, killing 47 people, and another train exploded without injuries last month in North Dakota.

“Myself and other people were pretty freaked out about what happened there,” West said of the two fiery blasts.

The provincial working group was mandated to submit a report to both leaders by the end of December.

An Alberta government official did not respond to a question about the completion or release of the report, while an official in Clark’s office said the report is complete but that no date has been set for a public release.

CN Rail declined comment.

The task force is led by Steve Carr, deputy minister of natural gas development in B.C. and Grant Sprague, deputy minister of energy in Alberta.

So the breathlessly awaited verdict on the Northern Gateway pipeline project is in, at long last. Net effect? Far less than it may seem. Despite the National Energy Board joint review panel’s greenlighting the controversial project, with a whopping 209 conditions, Northern Gateway is running out of time and probably doomed. Within six months the federal cabinet will render its own verdict. By then the interminable lawsuits and protests will be in full swing. And industry attention will have further turned toward projects with more attractive cost-benefit profiles. This may not be a terrible outcome. In any case, it now appears locked in.

Northern Gateway has been a political minefield from the start, because of geography. Its proposed route snakes 1,177 kilometres westward from Edmonton, Alta., to Kitimat, B.C., passing through traditional aboriginal territories. From Kitimat, Asiabound bitumen is to be shipped down the Douglas channel by tanker, to the ocean. The proposed volume is 525,000 barrels a day. That’s a lot of tankers – 220 per year – with a lot of moving pieces, conferring a risk profile different from that of any other North American pipeline plan currently on the books, that I know of. In the post Exxon Valdez era, selling this was never going to be easy. In the post-Lac-Mégantic era it looks nigh impossible.

The economic case in favour of a new pipeline to the Pacific has always been compelling. For starters, demand from Asian nations is soaring. Between now and 2035, the International Energy Agency predicts, emerging economies will account for 90 per cent of net energy demand growth, with China, India and Southeast Asia leading the way. Meantime, U.S. requirements for energy imports are on the wane. As early as 2020, due to new extraction technologies such as fracking, the United States may be energy-self-sufficient.

Moreover, market need for new pipeline capacity is immediate and pressing. Alberta crude already trades at a steep discount to the global price, simply because its product is bottlenecked to the west, east and south. Crude is moving, but not in sufficient quantities to ease a growing glut east of the Rockies. That discount – up to $25 off the price of a $100 barrel of oil – doesn’t just hit Big Oil’s bottom line; it hits the federal treasury. Over the next roughly two decades, the Conference Board has estimated, total tax proceeds from the oilsands and related industries will total $80 billion. Of that, more than half is federal.

As well, Northern Gateway opponents have undermined their own argument by citing climate change as a reason to nix the project. For, as with Keystone XL, the ultimate net effect on carbon emissions, whether crude moves one way or another, through this pipeline or that, or by ship or rail, is nil. If we assume the 173 billion barrels of crude in the oilsands will be extracted, one way or another – which is a safe assumption, given the projected skyrocketing of global demand for all forms of energy over the next 25 years – the carbon footprint doesn’t change. That’s because the primary energy cost is in the extraction. A heavy investment in new nuclear power plants in Northern Alberta could dramatically cut the oilpatch’s carbon footprint; killing the Northern Gateway pipeline won’t.

And, as a final argument in its favour, Northern Gateway has proposed environmental safeguards that would make it a standout in pipeline and tanker safety. These include land-based radar, new beacons, buoys and the like; provisions requiring that every tanker be escorted by two tugs, one tethered, to lessen the risk of a tanker running aground; requirements that each tanker be double-hulled, and less than 20 years old, and a two-pilot rule, to mitigate the risk of human error.

But set against all that is this single, powerful, incontrovertible fact: There is no way to reduce the risk of a tanker spill in the Douglas Channel to zero. Human error or equipment malfunction can always be a factor, as they have been in so many recent industrial tragedies. Such a spill would be beyond catastrophic; the Exxon Valdez disaster in 1989, which spilled 210,000 cubic metres of oil into Prince William Sound, established this.

Together with strong aboriginal opposition (exacerbated, it must be said, by the federal government’s refusal to entertain a separate First Nations consultation), this guarantees that, whatever the NEB says, and whatever the cabinet eventually says, there will be intense, prolonged opposition on the ground, and in the courts. That is a project-killer. It is not the case with Kinder Morgan’s Trans Mountain pipeline expansion, which has the virtue of being an expansion to something already built. Nor is it the case with Keystone XL, which has passed its local hurdles and now merely awaits approval from the Obama administration.

All of which leaves one with the sense that this NEB judgment, and the hue and cry to follow, are flash and fire, after the battle. This green light looks more like amber, on an indefinite clock.

EDMONTON – Simmering disputes over the oilsands between Alberta aboriginals and the provincial and federal governments will break into the open in 2014 as virtually every one of the many recent changes in oversight of the controversial industry comes under legal and political attack.

“All litigation, all the time, is what I see on the horizon,” said Larry Innes, lawyer for the Athabasca Chipewyan First Nation.

Over the last 18 months, Ottawa and Edmonton have rewritten the book on resource development. Everything from how aboriginals will be consulted to land use planning to oilsands monitoring to the basic ground rules for environmental assessment has been changed.

Governments say the new regime is more efficient, predictable and transparent. Aboriginals say it violates their rights and ignores their recommendations.

So as aboriginal groups in British Columbia prepare for an expected attack on the Northern Gateway pipeline proposal, Alberta aboriginals are pushing back with a long list of lawsuits either now or soon to be before the courts.
The Fort McKay First Nation is appealing an approval of Brion Energy’s plans for a 50,000-barrel-a-day operation northwest of Fort McMurray. It says the province has violated the constitution by setting up an energy regulator expressly forbidden to hear arguments based on aboriginal rights.

The Mikisew Cree and Frog Lake First Nation are before the courts arguing that Ottawa’s recent amendments to the Fisheries and Navigable Waters Acts run afoul of their rights.

The Beaver Lake Cree is fighting both levels of government in a case that seeks to force them to consider the cumulative effects of oilsands development when issuing new permits.

A total of 17 First Nations from around Alberta are trying to get legislation on access to public lands tossed out in a long-running case expected to go to trial this year.

The Athabasca Chipewyan First Nation plans to file a lawsuit in January attacking Ottawa’s new environmental assessment legislation after the approval of a major oilsands expansion that it says will violate both treaty rights and federal laws.

At the same time, the Alberta government’s other major oilsands initiatives are running into heavy weather.

All six First Nations in the oilsands area have requested a statutory review of the Lower Athabasca Regional Plan, the government’s attempt to balance development and environmental values. Those same bands, along with many others, have also rejected the province’s plans to centralize and control aboriginal consultation.

One major band  the Fort McKay First Nation  has pulled out of the Joint Oilsands Monitoring program, the showpiece federal-provincial effort to monitor environmental change in the oilsands.

Even the Lubicon Cree First Nation are back in court, with another try in a decades-long attempt to win a reserve and get some royalties on energy extracted from what they say is their land.

Alberta Environment and Minister Robin Campbell declined to be interviewed.

“We work with aboriginal leaders and communities in a variety of areas and will continue to do so,” said spokesman Kevin Zahara. “We will not speculate on possible legal challenges.”

A big part of the problem is simply the scale of development, said Nigel Bankes, professor of resource law at the University of Calgary.

“In the oilsands area, it’s really the intensity of the development,” he said.

“The treaties give the province the power to take up lands and the argument is there must be a limit to that. That can’t be an entitlement to take away all lands (to) which First Nations have historically exercised hunting rights.”

Those concerns grow as governments narrow who has the right to air concerns and what concerns they’re allowed to raise.

“I think that’s a fair characterization,” said Bankes, who said that process has been going on for years. “(There’s a) very narrow and stringent standing test and I think that does mean there’s a level of frustration out there.”

Not only are bands barred from raising aboriginal rights at regulatory hearings, two have recently been denied the right to even speak at ones concerning oilsands projects on their doorstep. Lawsuits happen when discussion fails, said Joe Jobin, chief operating officer of the Fort McKay First Nation.

“First Nations have always tried to work with the government on developing a policy that works for First Nations and for industry,” he said.

“The frustration is that the input is not being meaningfully considered. It’s almost like this attitude, ‘Well, if you don’t like it, take us to court.'”

The result is higher costs for everyone and uncertainty for industry, said Bankes. He added Alberta is increasingly resembling lawsuit-happy British Columbia, which has few treaties.

“What we’re seeing now is the same sort of litigation that we’ve been seeing in B.C. for a long time. This is now being transplanted to the treaty context of Alberta.

“Government has said to itself, ‘Things are clearer here, there’s more security precisely because we’ve got treaties.’ I guess what the litigation that we’re seeing now is calling into question is, is that really true?”

Innes said Alberta bands that have traditionally preferred to negotiate are increasingly through with talking.
“First Nations who have been investing in the process find the process is stacked against them,” he said.